The paper aims to provide an updated broad assessment of the environment for foreign direct investment (FDI) in light of the referendum vote in the UK to exit the European Union (Brexit), the election of Donald Trump as President of the USA and growing nationalist movements in Europe.
The paper uses an essay format to set out the main issues linking recent political developments to FDI. It reviews some relevant empirical literature to assess the identified linkages.
It seems reasonable to argue that there will be a reduction in FDI intensity on a global basis over the foreseeable future. It is also likely that the nature of FDI will move more toward being a substitute rather than a complement to trade.
The essay is original and valuable in the sense of offering a contemporary assessment of how important the recent political events may affect the FDI process.
